responsibilities. In April 2020, the Federal Reserve announced the establishment of the Municipal Liquidity Facility (MLF) to help …

We estimate the option value of municipal liquidity by studying bond market activity and public sector hiring decisions … eligibility population cutoffs introduced by the federal sector’s Municipal Liquidity Facility (MLF) to study the effects of an … emergency liquidity option on yields, primary debt issuance, and public sector employment. We find that while the announcement …

in the “liquidity trap equilibrium,” policy is mostly or always constrained. We use options data on future interest rates … target equilibrium and find no evidence in favor of the liquidity trap equilibrium. Quantitatively, while the lower bound has …